Question loss contingencyon december 42016 dan johnson, Ask an Expert

Accounting

Question: Loss Contingency

On December 4,2016, Dan Johnson delivery truck driver for Farmers products Inc, ran a stop sign and collided with another vehicle. On January 8,2017, the driver of the other vehicle filed suit aganist Farmers Products for damages to the vehicle. Estimated damages to the vehicle were between $6,000 and $10,000 with no amount with in the range more likely than any other amount. Farmers Products issued its 2016 financial statements on March 3, 2017.

Required: 1) Prepare the disclosures and or journal entries Farmers Products should make in preparing its December 31,2016, financial statements.

2) If Farmers Products used IFRS, how would the disclosures and /or journal entries differ from those under U.S. GAAP? Which of the following criteria is used to determine how Farmers Products discloses the law suit?

View complete question

Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M92866106

Have any Question?Write your Review or question?

Related Questions in Accounting Basics

Accounting question - a comparative balance sheet for

Accounting Question - A comparative balance sheet for Halper Corporation appears on the next page, and the statement of cash flows form follows. Explain below, why you must convert from an accrual basis of accounting to ...

Question - how would the firm determine the cost

Question - How would the firm determine the cost effectiveness of purchasing the long term assets used by the firm over an extended period of time?

Question - following are the transactions for abc computer

Question - Following are the transactions for ABC Computer Service's first month of business, September 2018: Sept 1 The owner invested $10,000 into the business in exchange for common stock. Sept 4 Purchased equipment f ...

Question - mr x wants to build a retirement fund of 500000

Question - Mr. X wants to build a retirement fund of $500,000 by the time he is 65. He is 40 today, and he plans to make 20 equal annual deposits to the fund, the first deposit to be made today. Assuming the fund will ea ...

Question - great outdoze company manufactures sleeping bags

Question - Great Outdoze Company manufactures sleeping bags, which sell for $65 each. The variable costs of production are as follows: Direct material$20 Direct labor 11 Variable manufacturing overhead 8 Budgeted fixed o ...

Question - ismail construction enters into a contract to

Question - Ismail Construction enters into a contract to design and build a hospital. Ismail is responsible for the overall management of the project and identifies various goods and services to be provided, including en ...

Question - nancy gives her grandson sean 20 acres of land

Question - Nancy gives her grandson, Sean, 20 acres of land. Her tax basis in the land is $25,000. Nancy's marginal tax rate for the current year is 45%; her grandson's is 25%. Its fair market value was $575,000 at the d ...

Question - what are the steps to finding the current stock

Question - What are the steps to finding the current stock price if dividend is $.6 at the end of the year, rate of return is 10.5% and growth rate is 7.7%?

Question - john lee is the manager in charge of the audit

Question - John Lee is the manager in charge of the audit of the upcoming annual audit of Hing Fat Ltd, a new audit client. All the preliminary verbal discussions and enquiries among the auditors, the company, the predec ...

Questions - q1 during 2017 belen paid the following

Questions - Q1. During 2017, Belen paid the following taxes: Property taxes on residence (paid from escrow account)$1,550Property tax portion of car registration (based on value) 400Property taxes on land held for long-t ...

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Accounting Basics Expert